Related papers: Shrouded Sin Taxes
When people pick routes to minimize their travel time, the total experienced delay, or social cost, may be significantly greater than if people followed routes assigned to them by a social planner. This effect is accentuated when human…
User marketing is a key focus of consumer-based internet companies. Learning algorithms are effective to optimize marketing campaigns which increase user engagement, and facilitates cross-marketing to related products. By attracting users…
Fisher markets are those where buyers with budgets compete for scarce items, a natural model for many real world markets including online advertising. A market equilibrium is a set of prices and allocations of items such that supply meets…
In portfolio compression, market participants (banks, organizations, companies, financial agents) sign contracts, creating liabilities between each other, which increases the systemic risk. Large, dense markets commonly can be compressed by…
So-called 'fast fashion' consumption, amplified through cost-effective e-commerce, constitutes a major factor negatively impacting climate change. A recently noted strategy to motivate consumers to more sustainable decisions is digital…
We study a system of $N$ agents, whose wealth grows linearly, under the effect of stochastic resetting and interacting via a tax-like dynamics -- all agents donate a part of their wealth, which is, in turn, redistributed equally among all…
We embed observational learning (BHW) in a symmetric duopoly with random arrivals and search frictions. With fixed posted prices, a mixed-strategy pricing equilibrium exists and yields price dispersion even with ex-ante identical firms. We…
We study the impact of economic integration on agglomeration in a model where all consumers are inter-regionally mobile and have heterogeneous preferences regarding their residential location choices. This heterogeneity is the unique…
In economic modeling, there has been an increasing investigation into multi-agent simulators. Nevertheless, state-of-the-art studies establish the model based on reinforcement learning (RL) exclusively for specific agent categories, e.g.,…
The European Union Emissions Trading System is set to substantially increase the effective carbon price faced by airlines. To quantify the impact of this carbon regulation on the European airline industry, we estimate a two-stage model of…
We use the fertile ground of betting markets to study the anticipation of major news in financial markets. While there is a considerable body of literature on the accuracy and efficiency of betting markets after important in-match events,…
As algorithms increasingly mediate competitive decision-making, their influence extends beyond individual outcomes to shaping strategic market dynamics. In two preregistered experiments, we examined how algorithmic advice affects human…
This paper investigates the assumption of homogeneous effects of federal tax changes across the U.S. states and identifies where and why that assumption may not be valid. More specifically, what determines the transmission mechanism of tax…
Massively multiplayer online role-playing games often contain sophisticated in-game economies. Many important real-world economic phenomena, such as inflation, economic growth, and business cycles, are also present in these virtual…
Developments in machine learning and big data allow firms to fully personalize and target their marketing mix. However, data and privacy regulations, such as those in the European Union (GDPR), incorporate a "right to explanation," which is…
If a financial asset's price movement impacts a firm's product demand, the firm can respond to the impact by adjusting its operational decisions. For example, in the automotive industry, car makers decrease the selling prices of…
We study economies where consumers interact independently with many monopolists. When consumer valuations over goods are correlated, correlation can distort the induced distribution of consumer surplus (information rents). We identify which…
This paper aims to explore the impact of tournament design on the incentives of the contestants. We develop a simulation framework to quantify the potential gain and loss from attacking based on changes in the probability of reaching the…
In this paper, we study a strategic model of marketing and product consumption in social networks. We consider two firms in a market competing to maximize the consumption of their products. Firms have a limited budget which can be either…
This article introduces a framework that is meant to assist in mitigating societal risks that software can pose. Concretely, this encompasses facets of software doping as well as unfairness and discrimination in high-risk decision-making…